Shalimar Paints Ltd. — Capital/Financing Update 2019

Nov 9, 2019

November 9, 2019

--- - -BSE-Limited Corporate Relationship Department, ^{I 51} Floor, New Trading Ring, Rotunda Building, P.J. Towers,

Dalal Street, Fort, Mumbai-400 ⁰⁰¹ - ---- National-Steek Exchange of India Ltd Exchange Plaza, 5thFloor, Plot No. C/1, G-Block Bandra Kurla Complex, Bandra (E), Mumbai - 400051

Reference: Scrip Code-NSE-SHALPAINTS. BSE-509874

Subject: Submission of Report of Monitoring Ageac

Dear Sir/ Ma'am,

Please find enclosed report of Monitoring Agency given by State Bank of India, Industrial Finance Branch 102 Natraj, 194, Sir, M.V Road, W.E Highway- Metro Junction, Andheri (E) Mumbai-400069, along with the Board Comments on the same.

This is for your information and record.

Thanking you, For Shalimar Paints Limited

s?

Chief Financial Officer

Encl: a/a

?m:? ?m:? STATE BANK OF INDIA

_______ snaumar Paints Limited, Stainless Steel Centre, 4th floor, Plot No -50, Sector 32, Gurgaon -122 001

SBI/IFB AND/AGM&RM/AMT-IV/2019-20/282

Date: 07.11.2019

Dear Sir,

SHALIMAR PAINTS LIMITED REPORT OF THE MONITORING AGENCY.

With reference to above please find enclosed report of the monitoring agency as on 30.09.2019 for the Rights Issue proceeds in the prescribed format.

Yours faithfully,

?,

AGM & Relationship Manager

E])bank.sbi

? +91 22 2681 9700 +91 22 2682 3370 / 2682 1310 ? +91 ^{22 2683 3001} / ²⁶⁸³ 1648 1:31sb1.04732@sbl.co.in

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?-400069. Industrial Finance Branch, Andheri, 102, Natraj,194, Sir M.V. Road, W.E. Highway-MetroJunction, Andheri (El,Mumbai • 400 069.

SCHEDULE XI - FORMAT OF REPORT TO BE SUBMITTED BY THE MONITORING AGENCY [See regulation 82(2) and 82(3))

	Monitoring Agency Report of the
---Name	Limited Shalimar Paints of the issuer:

For quarter ended: 301h September ²⁰¹⁹

Name of the Monitoring Agency: State Bank of India, Industrial Financial Branch, Andheri East, Mumbai- 400069

(a) Deviation from the objects: Due to lower Subscription of92.28% in the Rights Issue, the proceeds from the Rights Issue amounted to Rs. 20,087.24 Lakhs instead of Rs. ^{2 I} ,767.15 Lakhs as per the Letter of Offer. Accordingly, the amount allocated in some of the Objects has been modified. In view of additional Working Capital requirement, there is increase in the allocation of funds towards Long Term Working Capital Requirement -The major Object of the Issue. Further, the same is adjusted through reduction in estimated cost of Setting up of Paints manufacturing plant at Nashik including Regional Distribution Centre (RDC) at Nashik.

(b) Range of Deviation": The Company received Rs. 20,087.24 Lakhsfrom the proceeds of the Rights Issue in view of lower subscription instead of Rs. 21,767.15 Lakhs. Accordingly, the amount allocated in some of the Objects was modified. Further, in view of additional Working Capital requirements and reduction in estimated cost of Setting up of Paints manufacturing plant at Nashik including Regional Distribution Centre (RDC) at Nashik, the utilisation for Long Term WorkingCapital has increased by 3.21%. ·

Declaration:

We declare that this report is based on the format prescribed by the SEEi (JCDR) Regulations, 2018, We further declare that this report provides ^a true and fair view of the utilization of the issue proceeds.

We declare that we do not have any direct/indirect interest in or relationship with the issuer/promoters/ directors/management and also confirm that we do not perceive any conflict of interest in such relationship/interest while monitoring and reporting the utilization of the issue proceeds by the issuer. However, we are one of the Bankers to the Company and have extended Credit Facilities to it.

Signature: ??,

Name and designation of the Authorized Signatory: Rajendra Benodekar Designation of Authorized person/SigningAuthority: Assistant General Manager Seal of the Monitoring Agency: Date: [07.11.2019}

1

I) Issuer Details:

Name of the issuer: Shalimar Paints Limited Names of the promoter : Mr. Ratan Jindal and Hind Strategic Investments

Industry/sector to which it belongs: Paint & Coatings

2) Issue Details

Issue Period : December 03, ²⁰¹⁸ to December 24, 2018

Type of issue (public/rights) : Rights Issue

Type of specified securities : Equity Shares of the Company

!PO Grading, if any : Not applicable

Issue size (Rs, In Lacs): Rs.21,767.15 Lakhs (Final

Figure of Subscription was Rs. 20,087.24 Lakhs) 3) Details of the arrangement made to ensure the monitoring of issue proceeds:

{Give item by item description for all the objects stated in the offer document separately in following format)

Particulars
	Reply	Comments of the	Comments the
		Monitoring Agency	Board of
			Directors
Whether all utilization is as per the disclosures in	Yes/	Yes#	Yes#
the Offer Document?	No
Whether shareholder approval has been obtained	Yes/		No
in case of material deviations# from expenditures	No	No
disclosed in the Offer Document?
Whether the means of finance for the disclosed	Yes/	No	No.
objects of the issue has changed?	No
Is there major deviation observed any the over	Yes/	No	No
earlier monitoring agency reports?	No
Whether ?I}Government/statutoryapprovals	Yes/	Yes	Yes
related to th? objectfs) have been obtained?	No
Whether all arrangements pertaining to technical	Yes/	Yes	Yes
assistance/collaboration in operation? are	No
Are there any favorable events improving the	Yes/	Yes	Yes
viability of these obiect(s)?	No
an1 unfavorable Are there affecting the events	Yes/	No	No
viability of the obiect(s)?	No
Is there other relevant information any that may	Yes/	No	No
materially affect the decision making of the	No
investors?

However, the utilization in different heads of the Objects of the Issue had to be modified in view oflesser proceeds collected in the Rights Issue due to lower subscription to the extent of92.28% and as well as slightly changed requirement in various heads.

*Where material deviation may be defined to mean:

(a) Deviation in the objects or purposes for which the funds have been raised

(b) Deviation in the amount of funds actually utilized by more than 10% of the amount projected in the offer documents.

4) Details of object(s) to be monitored:

(i) Cost of object(s)

{Give Item by Item Description for all the Objects Stated in Offer Document separately in following format)

( Rs. In Lacs)

SI.		Or ig ina l C ost			Co ent mm s	of the Boa rd of	Dir ect ors
No	d Item Hea	(as the per Off er Do ) ent cum	Rev ised Cos t*	Com of the ts Mo ito ing men Ag n r enc y	of Rea son cost isio rev n	sed Pro po f ina ing nc tio op n	ticu lars Par of firm nts ma arra nge me
l(a )	Pro jec f t o Rei nsta tem ent of int pa fac ing tur ma nu lan ash ik t a t N p	5, 152 .13	515 2.1 3 ised Rev to 507 5.89 Lac s	ign ific No ant C han s ge			de
2( b)	Set ing of t up l Dis ion Re g a trib utio Cen n tre ( RD C) at N ash ik	340 .00	340 ( Re vis ed to 40 .00 )	The ised of ller C rev RD uld cost be 40 sma Rs. Lac wo s.			I I
2	Lo Ten ng n Wo rki Ca ita l ng p Re ire nts q u me	13, 500 .00	12, 187 .80 ( the Fur r ised Rev to 12, 564 .15 )	In iew of Low Su bsc rip ion v 92.2 8% in er t the Rig hts Iss at ue, the allo d cate red d afte allo unt tme nt in the amo uce r was Rig hts Issu Fur the the add itio nal e. rki r, Wo Ca ital to t mee ng p Re ire nt, the allo cati for Lo q u me Ter k ing on W Ca ita l ng m or p Re ire has bee nts inc sed by Rs. 376 .35 qu me n Lak hs rea Rs. to 125 64. 15 Lak hs			I I
3	Gen l Co era rat rpo e pur pos es	3, 782 .75	3, 41 5.0 7	vie In of Low Su bsc ip ion w t 92. 28% in the er Rig hts r at Iss ue, the allo d cate redu ced afte allo unt in tme nt he amo r t was Rig hts Issu e
4	Ex for the pen ses issu e	92. 00	92. 00	No C ha e i n P d c ng rop ose ost
	Tot al *	22, 866 .88	21, 186 .99

Including Rs.20087.26 Lakhs from Rights Issue proceeds and Rs. ^I 099. ⁷³ lakhs received as Insurance claim for Nashik Plant.

3

(ii) Progress in the object(s) - (Give item by item description for all the Objects stated in the Offer Document in the following format)

(Rs.In Lacs)

		Am t oun	uti lize Am t oun	Se d till p 201 9	be 30. tem r			of Dir ect of the Bo ard ors Com nts me
Sr. No	He ad Item	as d p ro p os e in he t Off er Do ent cum ( Re ise d ) " v	As at be inn ing g of the ( rte qua r lu d ing Inc Ins ura nce cla im ds ) p roc ee	ing Du r the art qu er	the At of the end rte qua r	To tal tili zed unu unt amo	of the Com nts me M ito ing Ag on r en cy	idle for Rea son s fun ds	Pro d p ose cour se of ion act l I
l(a )	f Pro jec t o int of Rei nsta tem ent pa nuf uri lan t al act ma ng p hik Nas	515 2.1 3 Re vis ed to 507 5.8 9 Lac s	4, 0 4 1. 0 6	485 .83	4, 52 6.8 9	548 .89	dis clo sed Uti lisa tion as Off of # in Let ter er
b) 2(	Re ion l of Set tin g a g u p Dis trib utio Cen tre n ash ik at N ( RD C)	340 ( Re ise d v 4 0. 0 0 ) to	-	8.5 5	8.5 5	31. 45	ise d the As rev cost per Co of ive st g n O b j ( S ) # ect
2	Wo rki Ter Lo ng m ng ire Re Ca ita l nts q u me p	1 2, 1 8 7. 8 0 ( he Fu rt r Re vis ed to 1 2, 5 4. 1 5 ) 6	1 2, 3 8 2 6. 7	177 .88	1 2, 56 4. 1 5	-	from Rs. Mo dif ica tio n Lak hs Rs. 1 3, 5 0 0. 0 0 to Lak hs* 12, 187 .80 ise d the Rs. Fur rev to r Lak hs 125 64. 15
3	Ge al Co rat ner rpo e pur pos es	3, 4 1 5. 0 7	2, 5 0 2. 4 9	912 .58	3, 4 1 5. 0 7	-	Mo dif ica tio from Rs. n Lak hs Rs. 3, 8 2. 5 7 7 to Lak hs. 3, 4 1 5. 0 7
4	the issu for Ex e pen ses	92. 00	92. 00	-	92. 00	-	dis clo sed Uti lisa tio n as of Off in Let ter er
	Tot al	21, 186 .99	19, 02 1.8 1	1, 5 8 4. 8 4	20 60 6.6 5 ,	580 .34			I

4

* Inview of Lower Subscription in the Rights Issue, the amount allocated to the Objects were reduced.

As on September 30, 2019, Rs. 580.34 Lakhs are outstanding which are being paid to vendors of Projects. \$Provide following details under Item Head:

(a) Name of the objectts):

(b) Brief description of the objectts):

	(iii) Deployment of unutilised IPO proceeds:					(Rs. In Lacs)
Sr. No.	Type of instrument and name of the entity invested in	Amount invested	Maturity date	Earning	Return on Investment $(\%)$	Market Value as at the end of quarter*
	Fixed Deposit	300.00	8th October 2019 and 27th October 2019.	63.90	5.50%	300.00
	Balance with Bank	280.34	NA	NA	NA	280.34
	Total Available balance	580.34				580.34

Where the market value is not feasible, provide NAVINRV!Book Value of the same iv] Delay in implementation of the obiec

		Completion Date	Delay	(Rs. In Lacs) Comments of the Board of Directors
Object(s)	As per the Offer Actual* Document		(no. of days/ months)	Reason of delay	Proposed course of action
Project of Reinstatement of paint manufacturing plant at Nashik	31-03-2019	Completed in May 2019 commercial production started in August 2019	2 Month
Setting up of Regional Distribution Centre (RDC) at Nashik	$31 - 03 - 2019$	$31 - 12 - 2019$	9 Month
Long Term Working Capital Requirements	$31 - 03 - 2019$	Completed
General Corporate purposes	$31 - 03 - 2019$	Completed
Expenses for the issue	31-03-2019	Completed

case of continuing object{s),please specify latest/revised estimate of the completion date.

Comments of Board of Directors on Report of Monitoring Agency

Details of the arrangement made to ensure the monitoring of issue proceeds:

(Give item by item description for all the objects stated in the offer document separately in the following format)

Particulars	Reply	Comments of the	Comments the
		Monitoring Agency	Board of Directors
Whether all utilization is as per the disclosures in	Yes/	Yes#	Yes#
the Offer Document?	No
Whether shareholder approval has been obtained in	Yes/		No
of material deviations# from expenditures case	No	No
disclosed in the Offer Document?
Whether the of finance for the disclosed means	Yes/	No	No.
objects of the issue has changed?	No
Is there major deviation observed the any over	Yes/	No	No
monitoring earlier reports? agency	No
Whether all Government/statutory approvals related	Yes/	Yes	Yes
to the objectis) have been obtained?	No
Whether all arrangements pertaining to technical	Yes/	Yes	Yes
assistance/collaboration in operation? are	No
favorable Are there improving the events any	Yes/	Yes	Yes
viability of these object(s)?	No
there unfavorable affecting the Are events any	Yes/	No	No
viability of the obiect(s)?	No
Is there information other relevant that any may	Yes/	No	No
materially affect the decision making of the	No
investors?

However, the utilization in different heads of the Objects of the Issue had to be modified in view of lesser proceeds collected in the Rights Issue due to lower subscription to the extent of 92.28% and as well as slightly changed requirement in various heads.

*Where material deviation may be defined to mean:

(a) Deviation in the objects or purposes for which the funds have been raised

(b) Deviation in the amount of funds actually utilized by more than 10% of the amount projected in the offer documents.

Details of object(s) to be monitored:

(i) Cost of object(s)

(Give Item by Item Description for all the Objects Stated in Offer Document separately in following format)

( Rs: In Lacs)

*

J

					of the Boardof Directors Comments
SL No	Item Head	Original Cost (as per the Offer Document)	Revised Cost*	of the Monitoring Agency Comments	revision of cost Reason	Proposed financing option	Particulars of firm arrangements made
l(a)	Project of of Reinstatement paint manufacturing plant at Nashik	5,152.13	5152.13 Revised to 5075.89 Lacs	No significant Change	No significant Change	No	No
2(b)	Setting up of Regional Distribution (RDC) at Centre Nashik	340.00	340 (Revised to 40.00)	be would of smaller RDC The revised cost Rs. 40 Lacs.	Centre(RDC) Regional Distribution Smaller is being setup.	NA	NA
2	Long Term Working Capital Requirements	13,500.00	12,187.80 (Further Revised to 12,564.15)	Subscription at 92.28% in In view of Lower allocated the Rights Issue, the amount was in the Rights Issue. after allotment reduced Working the additional Further, to meet Capital Requirement, the allocation for Working Capital Requirements Long Term Lakhs to by Rs.376.35 has been increased Rs. 12,564. I 5 Lakhs	Subscription at 92.28% in In view of Lower allocated the Rights Issue, the amount was in the Rights Issue. reduced after allotment Working the additional Further, to meet Capital Requirement, the allocation for Working Capital Requirements Long Term Lakhs to j by Rs.376.35 has been increased Rs. 12,564.15 Lakhs	NA	NA
3	General Corporate purposes	3,782.75	3,415.07	Subscription at 92.28% in In view of Lower allocated the Rights Issue, the amount was in the Rights Issue reduced after allotment	I in Subscription at 92.28% In view of Lower allocated the Rights Issue, the amount was in the Rights Issue after allotment reduced	NA	NA
4	Expenses for the issue	92.00	92.00	No Change in Proposed cost	NA	NA	NA
	Total	22,866.88	21,186.99			?	PAt? r:-:z.
	* Including Rs.20087.26	Lakhs	from	lakhs received and Rs. 1099.73 proceeds Rights Issue	claim for Nashik Plant. as Insurance	:c	??? 0 •
						cf)

?

	(Give item by item description for all the Objects stated			in the Offer Document		in the following format)		Lacs) (Rs.In
		Amount	utilized Amount	till September 30, 2019				of the Board Comments I	of Directors
Sr. No.	Item Head	as proposed in the Offer Document ( Revised)*	As at beginning of the quarter ( Including Insurance claim proceeds)	During the quarter	At the end of the quarter	Total unutilized amount	of the Comments Monitoring Agency	for idle Reasons funds	Proposed course of action
l(a)	Project of of paint Reinstatement manufacturing plant at Nashik	5152.13 Revised to 5075.89 Lacs	4,041.06	485.83	4,526.89	548.89	as disclosed Utilisation of Offer# in Letter	Due to delay in supply structural	Bills awaited and being payment are made
2(b)	Setting up of Regional Distribution Centre (RDC) at Nashik	340 (Revised to 40.00)	-	8.55	8.55	31.45	the revised As per cost given Cost of Obiect(S)#	started Activity was after completion of Main Plant.	being Payment are made
2	Working Long Term Capital Requirements	12,187.80 (Further Revised to 12,564.15)	12,386.27	177.88	12,564.15	-	Modification from Rs. · 13,500.00 Lakhs to Rs. 12,187.80 Lakhs*. revised to Rs. Further Lakhs 12564.15	Fully Utilised	NA
3	General Corporate purposes	3,415.07	2,502.49	912.58	3,415.07	-	Modification from Rs. 3,782.75 Lakhs to Rs. 3,415.07 Lakhs.	Pully Utilised	NA
4	Expenses for the issue	92.00	92.00	-	92.00	-	as disclosed Utilisation of Offer in Letter	I .fiully Utilised	NA
	Total	21,186.99	19,021.81	1,584.84	20,606.65	580.34

* In view of Lower Subscription in the Rights Issue, the amount allocated to the Objects were reduced. #As on September 30, 2019, Rs. 580.34 Lakhs are outstanding which are being paid to vendors of Projects. \$Provide following details under Item Head: (a) Name of the object(s):

(ii) Progress in the object(s) -

(b) Brief description of the object(s):

(c) Location of the object(s) (if applicable):

C") D 111	{ 'Ii dIPO d l unutz s: ep. ovment procee tse o				(&/JL)	acs 1
Sr. No.	of the and name Type of instrument entity invested in	Amount invested	Maturity date	Earning	Return on Investment(%)	'Value as at the Market end of quarter*
1	Fixed Deoosit	300.00	and 27th October 2019. 2019 8th October	63.90	5.50%	300.00
				NA	NA	280.34
2	Balance Bank with	280.34	NA			580.34
	Available balance Total	580.34

* Where the market value is not feasible, provide NAVINRV/Book Value of the same

of the object(s) (iv) Delay in implementation		Completion Date	Delay	of the Board Comments	of Directors
Object(s)	As per the Offer Document	Actual"	(no. of days/ months)	of delay Reason	Proposed of action course
of paint Project of Reinstatement manufacturing plant at Nashik	31-03-2019	in May 2019 Completed production commercial in August 2019 started	2 Month	due to delay in The delay was of plant. construction	Reinstatement completed
Setting up of Regional Distribution (RDC) at Nashik Centre	31-03-2019	31-12-2019	9 Month	of main plant got Since the construction of RD <c alsodelayed, the construction I got delayed	The Construction will be completedin I December 2019
Working Capital Long Term Requirements	31-03-2019	Completed		I Completed	NA
Corporate purposes General	31-03-2019	Completed		Completed	1'1 A- __,_,. .?
Expenses for the issue	31-03-2019	Completed	0	Completed	'''Vr? ?? '(1' (.??

*